Hopewell explores up to $10 million in bonded debt using insured-public offering to fund capital needs

Financial advisor Jimmy Sanderson presented capital-raising options for urgent municipal needs, describing conversations with traditional lenders and an alternative approach from Cruz & Associates that could underwrite based on unaudited financials and utilize bond insurance to make the offering marketable.

Sanderson said traditional lending options would have required concessions the city should avoid and that Cruz & Associates suggested a structure with bond insurance so the bonds would be rated on the insurer's rating rather than the city's lack of rating. "One of the key ways to do it in their view would be to get bond insurance," Sanderson said. He and Cruz described possible borrowing scenarios of $2 million, $5 million and $10 million with a 20-year amortization and a typical 10-year par call.

Estimated transaction costs were presented (~$350,000), along with projected FY26 debt-service impacts (about $100,000 for a $2 million issue, about $225,000 for $5 million, and about $425,000 for $10 million). Sanderson noted a potential structuring advantage for the city because of an expected debt-service drop in FY2028 that could be aligned with principal payments to limit near-term budgetary pressure.

Council members expressed support for the staff-led next steps: provide unaudited financials to Cruz for due diligence, engage bond counsel, and schedule public hearings required for a general-obligation bond pledge. No formal ordinance was adopted in the meeting; council gave direction to proceed with due diligence and public-notice planning.